ENA Sectors 2023-09-14 13:28:02 <p><span style="font-size:14px"><strong>Mumbai, Sept 14 (KNN)</strong> The Reserve Bank of India (RBI) on Wednesday notified that Banks and NBFCs have to release documents of properties and collateral mandatorily within 30 days.</span></p> <p><span style="font-size:14px">The central bank issued this notification focusing on the Responsible Lending Conduct Release of Movable / Immovable Property Documents on Repayment and Settlement of Personal Loans.</span></p> <p><span style="font-size:14px"><strong><a href="https://bit.ly/3B9mZSj"><img alt="FOLLOW US on GOOGLE NEWS" src="https://knnindia.co.in//uploads/gallery/GoogleNews.jpg" style="border-style:solid; border-width:1px; height:95px; margin:1px; width:299px" /></a></strong></span></p> <p><span style="font-size:14px">In terms of the guidelines on Fair Practices Code issued to various Regulated Entities (REs) since 2003, REs are required to release all movable / immovable property documents upon receiving full repayment and closure of loan account.</span></p> <p><span style="font-size:14px">However, RBI has observed that the REs follow divergent practices in release of such movable / immovable property documents leading to customer grievances and disputes.</span></p> <p><span style="font-size:14px">To address the issues faced by the borrowers and towards promoting responsible lending conduct among the REs, RBI has issued a slew of directions that shall be applicable to all cases where release of original movable / immovable property documents falls due on or after December 1, 2023.</span></p> <p><span style="font-size:14px">The REs shall release all the original movable / immovable property documents and remove charges registered with any registry within a period of 30 days after full repayment/ settlement of the loan account.</span></p> <p><span style="font-size:14px">Further the borrower shall be given the option of collecting the original movable / immovable property documents either from the banking outlet / branch where the loan account was serviced or any other office of the RE where the documents are available, as per her / his preference.</span></p> <p><span style="font-size:14px">The timeline and place of return of original movable / immovable property documents will be mentioned in the loan sanction letters issued on or after the effective date, as per the notification.</span></p> <p><span style="font-size:14px">In order to address the contingent event of demise of the sole borrower or joint borrowers, the REs shall have a well laid out procedure for return of original movable / immovable property documents to the legal heirs. Such procedure shall be displayed on the website of the REs along with other similar policies and procedures for customer information.</span></p> <p><span style="font-size:14px">In case of delay in releasing of original movable / immovable property documents or failing to file charge satisfaction form with relevant registry beyond 30 days after full repayment/ settlement of loan, the RE shall communicate to the borrower reasons for such delay.</span></p> <p><span style="font-size:14px">Moreover in case where the delay is attributable to the RE, it shall compensate the borrower at the rate of Rs 5,000/- for each day of delay.</span></p> <p><span style="font-size:14px">The notification can be accessed at: <a href="https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12535&amp;Mode=0">https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12535&amp;Mode=0</a> <em><strong>(KNN Bureau)</strong></em></span></p> 34787 https://knnindia.co.in/news/newsdetails/sectors/rbi-orders-release-of-documents-related-to-properties-and-collateral-within-30-days 2023-09-14 13:28:02 knnindia.co.in